An application for issuance of a new motor vehicle sales finance license must be submitted on forms prescribed by the commissioner at the date of filing and in accordance with the commissioner's instructions. The application must include the appropriate fees and the following:

1. (1) Required forms.

   1. (A) Application for Motor Vehicle Sales Finance License.

      1. (i) Location. A physical street address must be listed for the applicant's proposed licensed location. If the address has not yet been determined or the application is for an inactive license, then the application must indicate an application for an inactive license.
      2. (ii) Responsible person. The person responsible for the day-to-day operations of applicant's proposed office must be listed.

      3. (iii) Signature.

         1. (I) If the applicant is a proprietor each owner must sign.
         2. (II) If the applicant is a partnership, each general partner must sign.
         3. (III) If the applicant is a corporation, an authorized officer must sign.
         4. (IV) If the applicant is a limited liability company, an authorized member or manager must sign.
         5. (V) If the applicant is a trust or estate, the trustee or executor, as appropriate, must sign.
         6. (VI) If the applicant is a nonprofit organization, an authorized officer must sign.
   2. (B) List of Registered Offices for a Motor Vehicle Sales Finance License. Each additional location, other than the licensed location shown on the Application for Motor Vehicle Sales Finance License, must be listed on this form. The applicant should provide the assumed name (DBA), physical address, telephone number, and the person responsible for day-to-day operations for each registered office. A registered office is required for any additional assumed name that the licensee uses at a single location to engage in a Texas Finance Code, Chapter 348 transaction.

   3. (C) Disclosure of Owners and Principal Parties.

      1. (i) Proprietorship. The applicant must disclose who owns and who is responsible for operating the business. All community property interest must also be disclosed. If the business interest is owned by a married individual as separate property, documentation establishing or confirming separate property status must be provided.
      2. (ii) General partnership. Each partner must be listed and the percentage of ownership stated. If a general partner is wholly or partially owned by a legal entity and not a natural person, a narrative or diagram must be attached that includes the names and titles of all "managerial officials," as that term is defined in Texas Business Organization Code, §1.002 and a description of the ownership of each legal entity must be provided. General partnerships that register as limited liability partnerships should provide the same information as that required for general partnerships.

      3. (iii) Limited partnership. Each partner, general and limited, must be listed and the percentage of ownership stated.

         1. (I) General partners. The applicant should provide the complete ownership, regardless of percentage owned, for all general partners. If a general partner is wholly or partially owned by a legal entity and not a natural person, a narrative or diagram must be attached that includes the names and titles of all "managerial officials," as that term is defined in Texas Business Organization Code, §1.002, and a description of the ownership of each legal entity must be provided.
         2. (II) Limited partners. The applicant should provide a complete list of all limited partners owning 10% or more of the partnership.
         3. (III) Limited partnerships that register as limited liability partnerships. The applicant should provide the same information as that required for limited partnerships.
      4. (iv) Corporation. The officers and directors' sections on the form must be completed. Each shareholder holding 10% or more of the voting stock must be listed if the corporation is privately-held. If a parent corporation is the sole or part owner of the proposed business, a narrative or diagram must be attached that describes each level of ownership of 10% or greater.
      5. (v) Limited liability company. Each manager, officer, agent, and member owning 10% or more of the company, as those terms are defined in the Texas Business Organization Code, §1.002, and as used in Texas Business Organization Code, Title 3, Chapter 101, Limited Liability Companies, must be listed. If a member is a legal entity and not a natural person, a narrative or diagram must be attached that describes each level of ownership of 10% or greater.
      6. (vi) Trust or Estate. Each trustee or executor, as appropriate, must be listed.
      7. (vii) Nonprofit organizations. Each officer must be listed.
   4. (D) Application Questionnaire. All questions must be answered. Questions requiring a "yes" answer must be accompanied by an explanatory statement and any appropriate documentation requested on the form.
   5. (E) Appointment of Statutory Agent and Consent to Service. This form must be completed by each applicant. The statutory agent is the person or entity to whom any legal notice may be delivered. The agent must be a Texas resident and list an address for legal service. If the statutory agent is a natural person, the address must be a physical residential address. If the applicant is a corporation or limited liability company, the statutory agent should be the registered agent on file with the Texas Secretary of State. If the statutory agent is not the same as the registered agent filed with the Texas Secretary of State, then the applicant must submit certified minutes appointing the new agent.
   6. (F) Personal Affidavit. Each individual listed on the Disclosure of Owners and Principal Parties meeting the definition of principal party as defined in §84.101 of this title (relating to Definitions) must complete this form. All requested information must be provided.
   7. (G) Personal Questionnaire. Each individual listed on the Disclosure of Owners and Principal Parties meeting the definition of principal party as defined in §84.101 of this title must complete this form. Each question must be answered. If any question, except question 1, is answered "yes," an explanation must be provided.
   8. (H) Employment History. Each individual listed on the Disclosure of Owners and Principal Parties meeting the definition of principal party as defined in §84.101 of this title must complete this form. Each principal party should provide a continuous 10-year history, with no gaps, accounting for time spent as a student, unemployed, or retired. The employment history must also include the individual's association with the entity applying for the license.

   9. (I) Fingerprint cards.

      1. (i) For all persons meeting the definition of principal party as defined in §84.101 of this title, a complete set of legible fingerprints must be provided. All fingerprints should be submitted in a format prescribed by the agency and approved by the Department of Public Safety and the Federal Bureau of Investigation.
      2. (ii) For limited partnerships, if the Disclosure of Owners and Principal Parties under subparagraph (C)(iii)(I) of this paragraph does not produce a natural person, the applicant must provide a complete set of legible fingerprints for individuals who are associated with the general partner as principal parties.
      3. (iii) For entities with complex ownership structures that result in the identification of individuals to be fingerprinted who do not have a substantial relationship to the proposed applicant, the applicant may submit a request to fingerprint three officers or similar employees with significant involvement in the proposed business. The request should describe the relationship and significant involvement of the individuals in the proposed business. The agency may approve the request, seek alternative appropriate individuals, or deny the request.
      4. (iv) For individuals who have previously been licensed by the agency and principal parties of entities currently licensed, fingerprints are not required.

2. (2) Other required filings.

   1. (A) Contract forms. The applicant must provide information regarding the retail installment contract forms generally expected to be used.

      1. (i) Custom forms. If a custom contract form is anticipated for regular use, a complete preliminary draft indicating the number and distribution of copies expected for each transaction must be submitted.
      2. (ii) Stock forms. If an applicant plans to purchase stock forms from a supplier, the applicant must attach a statement that includes the supplier's name and address and a list identifying the forms to be used.
   2. (B) Statement of Experience. An applicant should provide information that relates to the applicant's prior experience in the motor vehicle sales finance business. If the applicant or its principal parties do not have significant experience in the business, the applicant must provide a written statement explaining the applicant's relevant business experience or education, why the commissioner should find that the applicant has the requisite experience, and how the applicant plans to obtain the necessary knowledge to operate lawfully and fairly.

   3. (C) Business Operation Plan. An applicant must attach a brief narrative to the application explaining:

      1. (i) an estimate of how many motor vehicles will be financed by the applicant each year;
      2. (ii) whether the applicant will hold the retail installment contracts or whether the applicant will assign its retail installment contracts;
      3. (iii) whether the applicant will only be accepting contracts from another entity (assignor), and, if so, list the types of entities; and
      4. (iv) whether the collections will occur at the licensed location.

   4. (D) Statement regarding previous installment transactions. Each applicant must submit a statement that it has or has not made or collected on any retail installment contract or accepted the cash payment for a motor vehicle in one or more installments from September 1, 2002, to date. This includes any contracts signed by applicant as seller that are subsequently assigned to a third party. If the applicant is purchasing another dealership and has permission to operate under an existing license, as described in §84.104 of this title (relating to Transfer of License), the statement outlined by this subparagraph is not required. If the applicant has engaged in any of the referenced activities, the applicant must provide the following information:

      1. (i) A list of all contracts used to finance the sale of a motor vehicle in one or more installments (whether the applicant was the original seller or whether the applicant became a holder). The list should include the name of the buyer, contract date, vehicle cash price, amount of down payment, net trade-in amount, total amount financed, payment frequency (monthly, semi-monthly, bi-weekly, weekly), total number of payments, and payment amount(s).
      2. (ii) From the list provided by the applicant, submit copies of ten (10) complete files. The complete file includes, but is not limited to, the buyer's order, signed retail installment contract, payment history, certificate of title, and other documents related to that transaction. If there are fewer than ten (10) accounts, provide a complete copy of each file.
   5. (E) Assumed name. If applicable, provide evidence that all assumed names have been filed with either the county clerk's office (proprietors and general partnerships) or the Texas Secretary of State (corporations, limited liability companies, and limited partnerships).

   6. (F) Entity documents.

      1. (i) Partnerships. A partnership applicant must submit a copy of the relevant portions of the partnership agreement addressing ownership and the responsibility for operations. If the applicant is a limited partnership or a limited liability partnership, provide evidence of filing with the Texas Secretary of State.

      2. (ii) Corporations. A corporate applicant, domestic or foreign, must provide the following documents:

         1. (I) copies of the relevant portions of the by-laws addressing the required number of directors and the required officer positions for the corporation; and
         2. (II) minutes of corporate meetings that record the election of the statutory agent and all current officers and directors as listed on the Disclosure of Owners and Principal Parties, or a certification from the secretary of the corporation identifying the statutory agent and current officers and directors as listed on the Disclosure of Owners and Principal Parties.
      3. (iii) Publicly-held corporations. In addition to the items required for corporations, a publicly-held corporation must file the most recent 10K or 10Q for the applicant or for the parent company.

      4. (iv) Limited liability companies. A limited liability company applicant, domestic or foreign, must provide the following documents:

         1. (I) a copy of the relevant portions of the operating agreement and regulations addressing responsibility for operations; and
         2. (II) minutes of meetings that record the election of the statutory agent and all current officers, directors, and managers as listed on the Disclosure of Owners and Principal Parties, or a certification identifying the statutory agent and current officers, directors, and managers as listed on the Disclosure of Owners and Principal Parties.
      5. (v) Trusts. A copy of the relevant portions of the instrument that created the trust addressing management of the trust and operations of the applicant must be filed with the application.
      6. (vi) Estates. A copy of the relevant portions of the instrument establishing the estate addressing management of the estate and operations of the applicant must be filed with the application.
      7. (vii) Nonprofit organizations. The applicant must provide a copy of the relevant portions of the instrument creating the nonprofit organization addressing management of the organization and operations of the applicant. A nonprofit applicant must also provide a copy of its filing with the Internal Revenue Service or other evidence to verify that the applicant is a nonprofit organization exempt from taxation under Internal Revenue Code of 1986, §501(c)(3).
      8. (viii) Foreign entities. In addition to the items required by this chapter, a foreign entity must provide a statement of where records of Texas transactions will be kept. If these records will be maintained at a location outside of Texas, the applicant must acknowledge responsibility for the travel costs associated with examinations in addition to the usual assessment, or agree to make all the records available for examination in Texas.
3. (3) Late filing. An applicant who desires to retroactively file a license application may do so by complying with Texas Finance Code, §349.303, and the rules adopted under this chapter.

Source Note:The provisions of this §84.102 adopted to be effective August 31, 2006, 31 TexReg 6652.